FOR IMMEDIATE RELEASE: NEWS
October 28, 1996 Nasdaq National Market/AVRT
http://www.avert.com
AVERT, INC. ANNOUNCES RECORD FINANCIAL RESULTS FOR THE THIRD QUARTER
AND NINE MONTH PERIOD
Net Income Grows 30% To Reach A Record $338,000; Net Margin Climbs to 15%
FORT COLLINS, Colorado - Avert, Inc. (Nasdaq National Market/AVRT), an
information services company that provides employment background checks
to a growing nationwide customer base, todya announced record financial
results for tis third quarter and nine month period ended September 30,
1996.
Net revenues for the third quarter grew to a record $2,213,800, up 31%
from $1,684,800 in the comparable quarter a year ago. Product and
service revenue for the quarter increased 34% to $2,134,000 from
$1,589,700 in the same quarter a year ago. The Company continued its
strong growth in new customers with 480 the third quarter, up 25% from
the third quarter last year.
Through nine months, the Company reported net revenues of $5,833,900, up
31% from $4,461,500 in the same period last year.
Net income reached a record $338,100, or 10 cents per share, up 30% from
$260,200, or 8 cents per share, in the same quarter last year. Net income
for the nine month period grew 14% to $799,700, or 23 cents per share, from
$701,000, or 20 cents per share, in teh comparable period a year ago. The
net margin for the quarter grew to 15.3%, from 13.7% in the second quarter,
and 11.6% in the first quarter of this year.
"We are pleased to see our net income growing at the same rate as our
revenues," said Dean Suposs, president and chairman at Avert, Inc. "The
July price increase and growth in service revenues have contributed to our
increased profitability. Avert has been able to sustain a high level of
profitability during strong growth periods and we anticipate this trend to
continue."
Revenue from criminal history reports grew 34% from the second quarter year
ago; previous employment reports, education and credit reports advanced 52%;
motor vehicle driving records increased 27%; workers' compensation histories
increased 1%; revenue from services increased 677%; and revenue from other
products increased 37%.
The Company implemented a 4-7% price increase July 1, 1996. "As indicated by
our continued growth in revenue and our increased profitability, the price
increase has been well-received. Additionally, we are focusing on growing
our service revenues which yield higher margins. We have had an excellent
response to our Avertadvantage program, with more than 1,000 new members,"
added Suposs.
Avertadvantage was also introduced in July and provides customers with
discounts, services and resources for $10/month.
Avert now has 13 independent sales representatives focused on increasing
Avert's exposure and revenue in their respectie territories. Avert has
also had success with its telesales department. During the quarter,
approximately 35% of the new customers were signed up by the telesales
department. Additionally, the Company launched a reseller program to
expand this distribution channels through independent representatives,
telesales, resellers, strategic partnerships and acquisitions.
Avert has now internally committed to spend up to $1.5 million to develop
new software and upgrade its existing sfotware over the next 1 1/2 years.
The Company expects the new software and upgrade of its existing software
to allow the Company to: 1) manage its higher volume with a lower cost
per transaction; 2) introduce new products and services at a much quicker
pace; 3) directly integrate the Company's information technology systems
with strategic partners, suppliers, and large customers; and 4) maintain
the Company's competitive position and provide leading edge, but safe and
proven, technology for its customers. Development of the software system
will be financed by available cash derived from past or continued
operations. The cost of the project will be amortized for 60 months. Suposs
stated, "We believe that this new technology will allow us to leapfrog any
of the developing competition and the new system capabilities will more
than pay for itself in increased opportunities."
Through its headquarters in Fort Collins, Avert is an information services
company that provides thousands of employment background checks daily to
employers nationwide. Avert guarantees that its products and services
are the most current and accurate available. Products and services include
criminal records, civil records, workers' compensation histories, driving
records, previous employment verification, credit histories, education
verification and license verification and social security number validation.
EARNINGS RECAP Third Quarter Ended Nine Months Ended
September 30, September 30,
1996 1995 1996 1995
(unaudited) (unaudited)
Revenue $2,213,800 $1,684,800 $5,833,900 $4,461,500
Net Income $ 338,100 $ 260,200 $ 799,700 $ 701,000
Net Income
per Common Share $ .10 $ .08 $ .23 $ .20
Weighted avg
shares outstanding 3,422,797 3,422,250 3,423,893 3,442,250
BALANCE SHEET DATA September 30, 1996 December 31, 1995
Working Capital $ 6,314,700 $6,426,900
Total Assets $ 9,049,400 $8,383,200
Total Liabilities $ 582,500 $ 547,800
Shareholders' Equity $ 8,466,900 $7,385,400
Contact:
Avert, Inc.
Kim Moss, Investor Relations 970/484-7722
